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Old Jan 28, 2013, 09:54 AM   #1
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Apple R&D Center Reportedly Confirmed for Shanghai




BrightWire summarizes a report [Google translation] from Chinese financial news site yicai.com noting that the city of Shangahi has officially announced Apple will open a new facility including some research and development operations in the city this summer.
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- Shanghai Municipal Commission of Commerce has announced that Apple will open its R&D center this summer.

- Apple has registered three firms in three buildings in Pudong, Shanghai, and one of them will be dedicated to procurement management and R&D, according to documents on the Shanghai Municipal Administration for Industry and Commerce's website.
While Apple had previously been reported to be developing an R&D facility in Beijing, the Shanghai plans have reportedly been underway for quite some time. Initial reports of a Chinese R&D facility emerged following a meeting between Apple CEO Tim Cook and the acting mayor of Beijing just two weeks ago, so it is unknown whether those plans are still in the works.

China is an enormously important market for Apple, with revenues of $7.3 billion in the last quarter alone. Cook described China as Apple's second largest region.
Quote:
If you look at our total Greater China, which would include our retail stores in China, our revenues were $7.3 billion in the quarter. So this is incredibly high, it's up over 60% year-on-year ... It's clear that China is already our second-largest region ... and it's clear that there's a lot of potential there.
A key challenge for Apple in China is that its products are typically too expensive for workers on an average salary. Apple recently introduced payment plans of up to two years, and the rumored low-cost iPhone is also expected to be offered in the Chinese market.

Article Link: Apple R&D Center Reportedly Confirmed for Shanghai
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Old Jan 28, 2013, 09:56 AM   #2
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and it's clear that there's a lot of potential there.
It's also clear that there are a lot of people there.
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Old Jan 28, 2013, 10:02 AM   #3
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Guess this will soon be a collector's item also....

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Old Jan 28, 2013, 10:10 AM   #4
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They were changing that to "Incremental Improvements by Apple in California" anyway.
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Old Jan 28, 2013, 10:11 AM   #5
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Hope their DLP program is up to scratch.
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Old Jan 28, 2013, 10:02 AM   #6
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..

even though it may be too expensive for the average salary I remember a story of young people selling vital organs in China to get ipads etc
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Old Jan 28, 2013, 10:12 AM   #7
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The human rights abuses in China are unacceptable and things are not getting better. You have got to wonder if this is a strategic move by Apple, done purely to give them more negotiation power against the Chinese Government and in their "courts".

Why would they choose Shanghai over Taiwan or Hong Kong or even a Japanese or Australian city?
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Old Jan 28, 2013, 10:16 AM   #8
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Originally Posted by RolyPolyBird View Post
The human rights abuses in China are unacceptable and things are not getting better. You have got to wonder if this is a strategic move by Apple, done purely to give them more negotiation power against the Chinese Government and in their "courts".

Why would they choose Shanghai over Taiwan or Hong Kong or even a Japanese or Australian city?
Think you pretty much nailed it there.
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Old Jan 28, 2013, 10:18 AM   #9
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Is it just me or is "reportedly confirmed" an oxymoron?

Last edited by dejo; Feb 19, 2014 at 10:28 AM. Reason: restored post.
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Old Jan 28, 2013, 10:19 AM   #10
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While this doesn't wont happen because of this move, the moment I see 'Designed by Apple in China,' on an Apple product I purchase, I'm done with them.
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Old Jan 28, 2013, 10:23 AM   #11
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I was just in Shanghai last week and went to check out the Apple store. Largest and most crowded Apple store I've ever seen.

Anyway as for location Shanghai is about as close to the center of East Asia as you can get (2-3 hours flight time to pretty much every major city). Location is very ideal geographically and is the main reason the city became so important economically in fairly recent history.

As for human rights abuses honestly very few people in China really care about it. People are more concerned about the air they breath and the baby formula they are feeding their kids. Though I guess having a habitable environment is a human right as well.

p.s. That picture of Shanghai is way too flattering.
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Old Jan 28, 2013, 10:29 AM   #12
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Originally Posted by RolyPolyBird View Post
The human rights abuses in China are unacceptable and things are not getting better. You have got to wonder if this is a strategic move by Apple, done purely to give them more negotiation power against the Chinese Government and in their "courts".

Why would they choose Shanghai over Taiwan or Hong Kong or even a Japanese or Australian city?
You're forgetting it is another culture there then over here. I'm not saying child labour and such is justifiable, it's just... You can't really compare it with situations in Western-Europe or North-America.

And I presume they're choosing Shanghai because of the massive interest and growth potential in China.
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Old Jan 28, 2013, 10:37 AM   #13
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Apple obviously wants to increase their level of innovation, but most of their cash ($97bn) lies overseas. So if they put their R&D overseas in like China, they could take advantage of all that unused cash.
I think this is a smart move by Apple to utilise the cash. The economy is better now than a 3-4 years ago, holding so much cash is not necessary.
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Old Jan 28, 2013, 10:55 AM   #14
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Originally Posted by RolyPolyBird View Post
The human rights abuses in China are unacceptable and things are not getting better.
And why do you say that? Things in China are much better than 50 or even 20 years ago.

A bit more perspective, the West's hands are not blood free either. Since the 90s, the United States has been involved in at least 4 or 5 major wars? China has been in none.

I think it's hypocritical for people from certain western nations to talk about human rights ...


In anycase, if you've been to China recently, most people happy with how things are. Yes, the country can do with more freedom of speech, better laws, equality, etc, but those things come with time. You don't want an overnight revolution, or else you end up with basket cases like Russia, Libya, IRaq, Afghanistan, etc.
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Old Jan 28, 2013, 12:24 PM   #15
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Originally Posted by RolyPolyBird View Post
The human rights abuses in China are unacceptable and things are not getting better. You have got to wonder if this is a strategic move by Apple, done purely to give them more negotiation power against the Chinese Government and in their "courts".
You have a problem with a "strategic move"? Should it be a random move?

And while I agree that human rights abuses in China are not good, why is Apple to blame? Are you saying their workers are abused? Do other phone manufacturers use laborers that are better treated or compensated?

Quote:
Why would they choose Shanghai over Taiwan or Hong Kong or even a Japanese or Australian city?
If most of their suppliers and production lines are in China, why would they build in Taiwan, Japan, or Australia? Hong Kong's in China. What do you have against Shanghai?
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Old Jan 28, 2013, 02:48 PM   #16
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You have a problem with a "strategic move"? Should it be a random move?

And while I agree that human rights abuses in China are not good, why is Apple to blame? Are you saying their workers are abused? Do other phone manufacturers use laborers that are better treated or compensated?

If most of their suppliers and production lines are in China, why would they build in Taiwan, Japan, or Australia? Hong Kong's in China. What do you have against Shanghai?
I am talking strategic move in the sense that it will buy them negotiating power with a corrupt regime, at the moment China has Apple by the balls. By putting an interlectual base in the country they can threaten to remove it, is this what its about?

Its not about costs, Apple is loaded and labour costs are irrelevant in this context, start up costs are likely to be more than in the places I suggested. Then there is the pain in the arse of dealing with Chinese bureaucracy and uncertainty, so why Shanghai? It reeks of tokenism.

As for Human right violations, I am talking about their treatment of minorities and disputed territories, religious freedom violations, persecution of journalists, artists, activists...police executing men and women out the back of police stations, child labour e.t.c. The list is endless.
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Old Jan 28, 2013, 02:50 PM   #17
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Quote:
Originally Posted by RolyPolyBird View Post
The human rights abuses in China are unacceptable and things are not getting better. You have got to wonder if this is a strategic move by Apple, done purely to give them more negotiation power against the Chinese Government and in their "courts".

Why would they choose Shanghai over Taiwan or Hong Kong or even a Japanese or Australian city?
They are in no position to negotiate with Chinese government. Not they, not Microsoft, not Google. Only choices for them is following the rules to play the game or leave.
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Old Jan 28, 2013, 03:02 PM   #18
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Originally Posted by alexN350z View Post
They are in no position to negotiate with Chinese government. Not they, not Microsoft, not Google. Only choices for them is following the rules to play the game or leave.
Having a player like Apple remove an important asset would be a significant blow to business confidence, they would likely have the regional government on their side. But agreed things are pretty much as you say.
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Old Jan 28, 2013, 04:51 PM   #19
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Originally Posted by RolyPolyBird View Post
The human rights abuses in China are unacceptable and things are not getting better. You have got to wonder if this is a strategic move by Apple, done purely to give them more negotiation power against the Chinese Government and in their "courts".

Why would they choose Shanghai over Taiwan or Hong Kong or even a Japanese or Australian city?
Human right abuses in every country is unacceptable. Look at the way Bradley Manning is being treated in the USA what about Julian Assange human right being treated in England. What about the human rights of those pop group members being jailed in Russia. Think no country is in the right mind to lecture about human right abuses when human right abuses occur in there own country. I think this is a good move by Apple it helps brings new ideas to apples r and d team.
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Old Jan 29, 2013, 01:35 PM   #20
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Originally Posted by RolyPolyBird View Post
The human rights abuses in China are unacceptable and things are not getting better. You have got to wonder if this is a strategic move by Apple, done purely to give them more negotiation power against the Chinese Government and in their "courts".

Why would they choose Shanghai over Taiwan or Hong Kong or even a Japanese or Australian city?
Because Shanghai is the oriental Paris even back to 1930s. The only city in East Asia that is comparative to Shanghai is Tokyo. Not like other places in mainland, Shanghai is also one of the most modernized and westernized cities in Asia. Do you have any idea how many westerners living in Shanghai?
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Old Jan 28, 2013, 10:03 PM   #21
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even though it may be too expensive for the average salary I remember a story of young people selling vital organs in China to get ipads etc
That's right... A Chinese boy who was 12 or 14 or something sold his kidney for an iPad 2 and a MacBook Air, I think it was.
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Old Jan 28, 2013, 11:25 AM   #22
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Apples push into China is not unexpected. I'm sure there is a large Chinese talent pool that a lot of U.S. Companies are not fully tapping into. Plus by generating jobs in China, I'm sure the government will be more willing to help Apple expand there retails stories and market share.

----------

Quote:
Originally Posted by ouimetnick View Post
Designed by Apple in China, Assembled in China.
If it is one of the macs that will be built here in the U.S. it could be

Designed by Apple in China, Assembled in the U.S.
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Old Jan 28, 2013, 11:51 AM   #23
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I'm sure there is a large Chinese talent pool that a lot of U.S. Companies are not fully tapping into.
Don't be so sure. If Apple tries to outsource anything but the most rote engineering tasks to China - eg, localization, design cost-reduction, manufacturing optimization - and attempts to do actual product design there, they will be in for a culture clash of epic proportions.

When our California-based tech startup recently attempted to merge its R&D with an overseas parent company dominated by Chinese management and engineering, the results were a disaster. The Confucian-oriented educational systems in these countries are designed to instill the antithesis of the "Think Different" ethos.

I think this is basically a save-face move to mollify the Chinese government.
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Old Jan 28, 2013, 12:19 PM   #24
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Don't be so sure. If Apple tries to outsource anything but the most rote engineering tasks to China - eg, localization, design cost-reduction, manufacturing optimization - and attempts to do actual product design there, they will be in for a culture clash of epic proportions.

When our California-based tech startup recently attempted to merge its R&D with an overseas parent company dominated by Chinese management and engineering, the results were a disaster. The Confucian-oriented educational systems in these countries are designed to instill the antithesis of the "Think Different" ethos.

I think this is basically a save-face move to mollify the Chinese government.
If the goal is to mollify (or even codify, or anything else in between), and Apple acquiesces, then you can guess what's going to start to happen over and over again... and, eventually, nobody will be able to think different, much less act different... or a worse form of action might take place... it depends on the underlying qualifiers...

I don't think it's mollification. Hanlon's razor prevailing, "Don't attribute to malice what can adequately be explained by greed" is more or less what's going on. Probably. But none of us knows the underlying, full set of facts. Or, as others might say, "the truth is in the middle".
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Old Jan 28, 2013, 12:42 PM   #25
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Apple won't outsource its legal department to China for sure.

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